Tax Residency vs Trust Residency: Why the Difference Matters for International Investors

Consider a scenario that arises regularly in international wealth planning. An investor lives in the United Kingdom, establishes a trust governed by Bahamian law, appoints a professional trust company in Nassau as trustee, and names adult children living in the United States and Canada as discretionary beneficiaries. The family asks: where is the trust resident, and which country’s tax rules apply to it?

There may not be a single answer. Several different legal concepts are in play simultaneously, and confusing them with each other is one of the most common and consequential mistakes made in international trust planning.

The five concepts that matter here are distinct: personal tax residency, trust residency, the governing law of the trust, the residence of the trustee, and the tax residency of the beneficiaries. None of these automatically determines the others. A trust governed by Bahamian law is not necessarily resident in The Bahamas for every tax and reporting purpose. A settlor who establishes a Bahamian trust does not thereby become tax resident in The Bahamas. A trustee located in Nassau may cause the trust to be reportable in The Bahamas under one framework while a different framework reaches a different conclusion.

This article explains how these concepts differ, why the distinctions matter in practice, and what questions international investors and their advisers need to ask before assuming that any single answer captures the full picture of their cross-border structure.

This article does not constitute tax advice. The legal and tax consequences of any international trust structure depend on the specific facts, the domestic laws of all connected jurisdictions, and the advice of qualified professionals in each of those jurisdictions.

What Is Tax Residency?

Tax residency, at its most basic level, determines which jurisdiction considers an individual or entity to be a resident for its domestic tax purposes. Tax residence matters because it typically determines the scope of a jurisdiction’s taxing rights: many countries tax their residents on worldwide income and assets, while applying more limited rules to non-residents.

The test for tax residency varies substantially between countries, and there is no single international standard. Depending on the jurisdiction, relevant factors may include the number of days an individual spends physically present in the country in a year, whether they maintain a permanent home there, the strength of their family and social connections, the location of their economic interests and employment, their domicile or habitual residence, and, in a small number of systems, their citizenship. In some countries, a combination of factors determines residence through a tie-breaker analysis. In others, meeting a single threshold, such as spending more than a specified number of days in the country, is sufficient.

Tax Residency Is Not the Same as Citizenship

It is entirely possible for an individual to hold citizenship in one country, be physically based in another, and be considered tax resident in a third. An entrepreneur who was born in Brazil, holds a British passport, and spends most of the year managing a business from the UAE may have a tax residency position in none of those countries, or in one of them, depending on each country’s specific rules and how they interact.

This point matters for trust planning because the tax residency of the settlor, and separately of each beneficiary, affects how their home jurisdiction treats the trust structure, distributions from it, and any income or capital gains arising within it.

Why Tax Residency Matters for Trust Structures

From the perspective of international trust planning, a settlor’s tax residency may affect how their home jurisdiction characterises the creation of the trust, the transfer of assets into it, any powers the settlor retains over it, and any income or capital gains that arise within the trust structure. A beneficiary’s tax residency may determine how distributions are taxed when received, what reporting obligations the beneficiary personally faces, and whether disclosure of foreign trust interests is required.

The consequences are entirely dependent on the specific rules of the relevant jurisdiction and cannot be determined from general principles alone.

What Is Trust Residency?

Trust residency is a separate question from personal tax residency, and it is answered differently depending on which legal, tax, or reporting framework is being considered.

There is no single universal test for where a trust is resident. Different frameworks apply different criteria, and a trust may be treated as resident in one jurisdiction for one purpose and differently for another.

For CRS (Common Reporting Standard) purposes in The Bahamas, the June 2024 updated guidance issued by the Bahamas Competent Authority states that a trust classified as a financial institution with one or more trustees residing in The Bahamas will be considered reportable in The Bahamas, regardless of its tax residency in a different participating jurisdiction. However, that same guidance provides that if the trust submits all CRS reports of its reportable accounts to the participating jurisdiction where it is tax resident, it will not have separate reporting obligations in The Bahamas.

This illustrates an important point: even within the CRS framework, the treatment is nuanced, and the relationship between where the trustee resides and where the trust is tax resident produces different outcomes depending on whether reporting has been made elsewhere.

For domestic tax purposes in third countries, the rules may be entirely different. Some jurisdictions apply a test based on where the trust is administered. Others focus on where the trust’s central management and control is exercised. Others treat the trust as resident in the jurisdiction of the trustees regardless of where the trust was established or what law governs it.

The relevant framework must always be identified before drawing any conclusion about where a trust is resident.

Tax Residency vs Trust Residency: The Key Differences

Important qualification: There is no universal international standard for either concept. Every connected jurisdiction may apply its own definition, and the same trust may be characterised differently in different countries simultaneously.

Governing Law Is Not the Same as Trust Residency

This distinction is fundamental and consistently misunderstood. The governing law of a trust and the jurisdiction in which it is considered resident for tax or reporting purposes are different things, and they can point to different countries.

The governing law of a trust determines which jurisdiction’s legal rules apply to interpret the trust instrument, define trustee powers, govern beneficiary rights, determine the validity of trust provisions, and regulate the fiduciary relationship between the trustee and the beneficiaries. In The Bahamas, the relevant legislation includes the Trustee Act 1998 as amended, the Trusts (Choice of Governing Law) Act 1989, and the body of common law that Bahamian courts apply.

None of that determines where the trust is tax resident. A trust governed by Bahamian law may have a trustee in Liechtenstein, assets in the United States and United Kingdom, a settlor in France, and beneficiaries in Australia. Each of those jurisdictions may have its own view of the trust’s status and may apply its own rules to the trust’s income, assets, or distributions.

As our guide to how international families use Bahamian trusts for succession planning discusses, the governing law of the trust is only one element in the legal analysis of a cross-border structure. The jurisdictions connected to the settlor, the assets, the trustee, and the beneficiaries all contribute their own rules, and those rules must be considered alongside the Bahamian legal framework rather than in isolation from it.

A Bahamian Trust Does Not Change the Settlor’s Personal Tax Residency

This point deserves explicit emphasis because it is a question that comes up frequently and is sometimes misunderstood.

Establishing a trust governed by Bahamian law, and appointing a Bahamian trustee, does not change the settlor’s personal tax residency. The settlor’s personal tax residency is determined by the rules of the relevant jurisdiction applying to the settlor as an individual, based on factors such as where they live, how many days they spend in each country, and the strength of their personal and economic connections to different jurisdictions. The existence of a trust structure in The Bahamas is not one of those factors.

Similarly, incorporating a Bahamian company does not change the personal tax residency of its shareholders. Appointing a Bahamian trustee does not make the settlor a resident of The Bahamas. Holding assets offshore does not alter the tax residence position of the person who holds the beneficial interest in those assets.

What may change is how the settlor’s home jurisdiction treats the trust structure and any income or gains arising within it. Many jurisdictions have specific rules governing how they tax residents who have established foreign trusts, whether they require reporting of the structure, and whether they attribute trust income to the settlor for domestic tax purposes. Those rules are entirely dependent on the home jurisdiction’s domestic legislation and vary considerably from country to country.

The Settlor’s Tax Residency Still Matters

Even though establishing a Bahamian trust does not change the settlor’s personal tax residency, the settlor’s tax residency remains a critically important variable in the overall structure.

The settlor’s home jurisdiction may apply attribution rules that treat trust income as the settlor’s personal income for domestic tax purposes, depending on the powers retained by the settlor, the nature of the trust, and the jurisdiction’s specific rules. It may require disclosure of the establishment of a foreign trust, reporting of its assets and transactions, or filing of forms relating to transfers to foreign structures. It may treat the transfer of assets into the trust as a taxable event, particularly where asset values have appreciated. And it may take an entirely different view of the trust’s character from the view taken by other connected jurisdictions.

Consider a hypothetical scenario: an internationally mobile entrepreneur establishes a Bahamian trust while tax resident in Country A and subsequently relocates to Country B. The trust instrument has not changed. The trustee remains in Nassau. The beneficiaries remain where they were. But Country B may have a completely different set of rules governing how it treats foreign trusts, what reporting it requires from its residents who are connected to such structures, and how it taxes distributions received from them. Country B’s classification of the trust may differ from Country A’s. The relocation requires a fresh cross-border analysis of the trust’s interaction with a new domestic tax system, and that analysis cannot wait until after the move has already occurred.

The Trustee’s Location Can Matter

Where the trustee is located, and where the trustee administers the trust, can be highly relevant to how the trust is classified for tax and reporting purposes in connected jurisdictions.

In the Bahamian CRS framework, as updated by the June 2024 guidance, trustee residence in The Bahamas is a relevant factor in determining whether a trust classified as a financial institution will be considered reportable in The Bahamas. The trustee’s location is also relevant to how some third-country tax authorities determine the residence of a trust for their own domestic purposes.

This is why trustee duties in The Bahamas extend beyond the purely legal administration of the trust to encompass responsibilities for compliance, record-keeping, KYC, and reporting that connect the trustee’s activity in The Bahamas to the broader international reporting framework. The trustee holds legal title to the trust assets and makes the decisions that constitute the trust’s administration. Where those decisions are made, and by whom, is not merely a governance question: it has legal and compliance consequences across multiple frameworks simultaneously.

What About a Private Trust Company?

For families using a Private Trust Company as trustee, the analysis adds another layer. The PTC is incorporated in a specific jurisdiction, its board meets and takes decisions at specified locations, and its directors are resident in various countries. Each of these factors potentially influences how the trust is characterised for administration, residence, and reporting purposes in connected jurisdictions.

Our article on Private Trust Companies in The Bahamas explains the structural distinction between the PTC and the trust itself. The PTC is the trustee, not the trust, and its own legal characteristics, regulatory status, and location of administration introduce separate considerations from those applicable to the trust.

Beneficiary Tax Residency Can Create Different Outcomes Within the Same Trust

This is one of the most important practical points in cross-border trust planning, and it is frequently underappreciated by both families and their advisers.

Consider a discretionary Bahamian trust with four beneficiaries: one living in the United States, one living in the United Kingdom, one living in Canada, and one living in another Caribbean jurisdiction. The trustee makes a distribution of the same amount to each beneficiary in the same year.

The trust has made four identical legal distributions. The four beneficiaries may experience four entirely different tax and reporting outcomes. The US beneficiary may face US federal income tax reporting obligations relating to distributions from a foreign trust and may need to file specific forms with the IRS in connection with the distribution. The UK beneficiary’s treatment will depend on UK trust tax rules applicable to distributions from non-resident trusts, which can be complex. The Canadian beneficiary faces Canadian rules on foreign trust distributions. The Caribbean beneficiary’s position depends on their jurisdiction’s specific rules.

The Bahamian trust has not done anything different in relation to any of the four beneficiaries. What differs is the domestic tax system each beneficiary brings to the distribution, and those systems may produce significantly different obligations and outcomes.

This is exactly why our guide to international family succession planning notes that a distribution approach suitable for one beneficiary may not be appropriate for another, and why trustees may need to obtain local legal and tax advice in the beneficiary’s jurisdiction before making significant distributions. The trust administration decision and the beneficiary’s domestic tax consequence are not the same analysis.

What Happens When a Beneficiary Changes Tax Residency?

The internationally mobile beneficiary creates an ongoing challenge for trust administration. Someone who begins as a New Zealand tax resident, then moves to the UK, then to Switzerland, then to Singapore, changes their domestic tax and reporting position at each step. The trust structure has not necessarily changed at all, but the legal and compliance consequences of distributions to that beneficiary change each time they move.

A beneficiary’s relocation is a review trigger, not a tax-planning technique. Before or promptly after relocation, the trustee and the beneficiary should consider how the new jurisdiction treats distributions from foreign trusts, what reporting obligations the beneficiary now faces in relation to their interest in the trust, and whether the timing of distributions needs to be reconsidered in light of the new domestic tax position.

The trust structure itself may also need reviewing. If the beneficiary has moved from a jurisdiction whose rules are compatible with the trust’s existing administration model to one with a more intrusive foreign trust reporting regime, adjustments to distribution timing, information-sharing practices, or administrative procedures may be warranted.

What Happens When Settlor, Trustee and Beneficiaries Are All in Different Countries?

This diagram captures the complexity that many international trust structures actually involve:

Settlor: Country A

Trust governed by: Bahamian law

Trustee: The Bahamas

Trust assets: Countries B, C and D

Beneficiaries: Countries E and F

Potentially relevant legal systems in this structure include: the settlor’s jurisdiction (Country A), which may have attribution rules, reporting requirements, or rules on the tax treatment of foreign trust transfers; Bahamian law, which governs the trust’s validity, the trustee’s powers, and the administration framework; the jurisdictions where assets are held (Countries B, C and D), which may have withholding taxes, local reporting requirements, or other rules applying to trust-owned assets; and the beneficiaries’ jurisdictions (Countries E and F), each of which may have different rules on foreign trust distributions.

Asking simply “where is my trust?” is therefore often the wrong starting question. The better questions are: which jurisdictions have a legal, tax, or reporting connection to this trust, what does each of those jurisdictions require, and how do those requirements interact with each other? Those questions do not have a single answer that can be read from the trust deed or the governing law clause alone.

Tax Residency and International Reporting Obligations

Common Reporting Standard

CRS provides for the automatic exchange of certain financial account information between participating jurisdictions. The Bahamas implemented CRS through the Automatic Exchange of Financial Account Information Act 2016 and associated regulations, and participates in automatic exchange with a substantial number of jurisdictions.

Whether a trust is a reporting entity under CRS depends on its classification. A trust classified as a financial institution, typically an investment entity under the applicable CRS definitions, has reporting obligations as a Reporting Financial Institution. A trust not classified as a financial institution may be a passive non-financial entity, in which case its controlling persons, including the settlor, protector, and beneficiaries meeting the specified criteria, become reportable at the level of the financial institution holding its accounts.

The June 2024 updated Bahamas CRS guidance clarifies that a trust classified as a financial institution with a trustee residing in The Bahamas will be considered reportable in The Bahamas, but provides that this obligation falls away if the trust reports in the jurisdiction where it is tax resident. The trustee is responsible for all reporting requirements applicable to the trust for CRS purposes.

FATCA

The Foreign Account Tax Compliance Act, implemented in The Bahamas through the FATCA legislation of 2015, creates reporting obligations in connection with financial accounts held or controlled by specified US persons. The Bahamas FATCA Guidance Notes explain how trusts are categorised under the FATCA framework, including the trustee-documented trust structure under which a licensed Bahamian trustee that qualifies as a financial institution and reports all required information for the trust’s reportable accounts takes on the reporting function.

A US-connected settlor, a US beneficiary, or a US protector may each be a relevant controlling person for FATCA purposes, and the specific reporting consequences depend on the individual’s US status and the trust’s classification. US persons connected to international trust structures should obtain specific US tax and reporting advice.

Legitimate Confidentiality Is Not the Same as Non-Disclosure

Our Bahamas foundation versus trust guide draws an explicit distinction between the legitimate privacy that a properly administered Bahamian trust structure provides and the concealment of information from regulatory and tax authorities. CRS, FATCA, beneficial ownership reporting, and the broader AML framework all apply to Bahamian trust structures fully. Legitimate privacy means freedom from unnecessary public disclosure of family arrangements, not freedom from reporting to competent authorities.

Tax Residency Is Also Different From Economic Substance

International investors working through cross-border structures sometimes encounter the concept of economic substance in the same conversation as tax residence, and it is worth clarifying that these are related but distinct concepts.

Tax residence determines where a person or entity is considered resident for the applicable jurisdiction’s tax purposes. Economic substance, under the CESRA framework in The Bahamas, concerns whether entities conducting relevant activities demonstrate an adequate physical and operational presence in The Bahamas in proportion to those activities.

The CESRA guidelines note that an entity claiming tax residence outside The Bahamas for economic substance purposes must be able to substantiate that claim and demonstrate that it is subject to the other jurisdiction’s corporate income tax regime. This connection between tax residence and the economic substance analysis illustrates that the two concepts interact in specific regulatory contexts, even though they address different underlying questions.

Common Mistakes International Investors Make

Assuming the Governing Law Determines Tax Residency

A trust governed by Bahamian law is not automatically tax resident in The Bahamas for every legal and tax purpose. The governing law determines which jurisdiction’s trust law applies. Tax and reporting residency is determined by separate rules, which vary by framework and jurisdiction.

Assuming a Bahamian Trust Makes the Settlor a Bahamas Tax Resident

The settlor’s personal tax residency depends on the rules of their own home jurisdiction, assessed against their personal circumstances. The existence of a Bahamian trust does not alter that analysis.

Ignoring Where Beneficiaries Live

Each beneficiary’s tax residency affects how that beneficiary is taxed on distributions and what reporting obligations they face. Two beneficiaries receiving the same distribution may have entirely different compliance requirements because of where they live.

Focusing Only on the Formation Date

A trust structure that was appropriate when established may need review years later because family members have relocated, assets have moved, regulations have changed, or new beneficiaries have been added. The common mistakes in offshore trust structures article addresses this pattern specifically: treating the trust as a one-time exercise rather than a structure that must be maintained and reviewed as circumstances evolve.

Moving Countries Without Reviewing Existing Structures

Relocation is one of the most significant review triggers for any international trust arrangement. A settlor who moves between jurisdictions, or a beneficiary who does, brings a different domestic tax and reporting system into contact with the trust structure. Obtaining advice before the move occurs is considerably more effective than addressing the consequences after the fact.

Assuming Offshore Means Outside the Reporting System

CRS, FATCA, beneficial ownership frameworks, and AML obligations all apply to properly administered Bahamian trust structures. An international trust does not sit outside these systems. It operates within them, and proper compliance with the reporting requirements of every connected jurisdiction is an ongoing obligation of the trustee and, where applicable, the trust’s connected persons.

When Should an International Family Review Tax and Trust Residency?

A formal cross-border review should be considered when any of the following occur: the settlor relocates to a different country; the trustee changes or moves to a different jurisdiction; a beneficiary relocates; new beneficiaries are added, particularly those in jurisdictions with complex foreign trust rules; the family business is sold or a major asset enters or leaves the trust; the trust begins investing in a new jurisdiction; family members acquire new citizenship or residence status; the distribution strategy changes significantly; the trust is restructured or a new layer added; or relevant legislation changes in any connected jurisdiction.

These are review triggers, not statements that a tax liability necessarily arises. The purpose of the review is to identify whether the existing analysis remains accurate and whether any adjustments to administration, distribution timing, or documentation are warranted before rather than after the change takes effect.

Tax Residency and Family Offices

For family offices managing internationally dispersed multi-generational family wealth, the intersection of personal tax residency, trust residency, and reporting obligations becomes particularly layered. A family office may coordinate trusts, companies, foundations, investment portfolios, real estate holdings, and philanthropic structures across a number of jurisdictions. Each family member and each entity in the structure may have a different residence and reporting profile.

Our article on establishing a family office in The Bahamas addresses how family offices fit within the broader legal and governance architecture of sophisticated international wealth structures. The point made there applies equally here: a structure that works administratively as a coherent whole at the family office level must still account for the different legal and reporting positions of each participant at the individual and entity level.

Five Questions International Investors Should Ask

These questions should be considered together. Answering any one of them in isolation rarely provides a complete picture for an international trust structure.

Where am I personally tax resident? This is a question about the individual’s own position, determined by the rules of each jurisdiction that might claim residency, not by the trust’s location or governing law.

Where is the trust considered resident under each relevant legal and reporting framework? This question has multiple potential answers depending on whether the applicable framework is CRS, FATCA, a domestic tax system, or another regulatory regime.

Which law governs the trust? This determines the legal rules that apply to the trust’s interpretation, administration, and the rights of its parties. It does not determine tax or reporting residency.

Where are the trustee, the beneficiaries, and the underlying assets located? Each of these connections may bring a different jurisdiction’s rules into the analysis.

Which jurisdictions impose tax or reporting obligations in connection with those connections? This is the question that requires jurisdiction-specific professional advice in each relevant country.

Why Coordinated Cross-Border Advice Matters

A Bahamas lawyer can advise on the validity of the trust under Bahamian law, the trustee’s powers and duties under the Trustee Act 1998, the application of the Trusts (Choice of Governing Law) Act 1989, the applicable FATCA and CRS reporting framework in The Bahamas, and the administration of the trust within the Bahamian legal system.

What a Bahamas lawyer cannot do is provide definitive tax advice about how the settlor’s home jurisdiction treats the trust, how any particular beneficiary’s jurisdiction taxes distributions, or what the reporting obligations of a US person connected to the trust look like under US federal tax law. Those questions require qualified advisers in the relevant jurisdictions, and those advisers need to be working from accurate information about the Bahamian legal structure rather than assumptions about what a “typical offshore trust” looks like.

Our comprehensive guide to offshore trusts in The Bahamas sets out the legal architecture of Bahamian trust structures in detail, including the relevant legislation, the roles of the parties, and the ongoing compliance obligations. That legal foundation is the starting point for the broader cross-border analysis, not a substitute for it.

Sophisticated international planning typically involves coordination between Bahamian trust counsel, the appointed trustee, tax advisers in the settlor’s jurisdiction, tax advisers in the beneficiaries’ jurisdictions, estate-planning lawyers in each relevant country, and, where applicable, family office professionals and investment managers. Each adviser contributes their specific expertise to a picture that no single jurisdiction’s adviser can assemble alone.

Conclusion

Tax residency, trust residency, and governing law answer different questions, and confusing them creates real problems for internationally connected families.

A trust governed by Bahamian law may be considered resident in one jurisdiction for CRS purposes, another for domestic tax purposes, and a third for FATCA purposes, all simultaneously and without contradiction. A settlor who establishes that trust remains tax resident wherever their personal circumstances locate them, regardless of where the trust is administered. Each beneficiary brings their own jurisdiction’s rules to every distribution they receive.

The productive approach is to map the full picture of connected jurisdictions before drawing any conclusions:

Settlor → Trustee → Trust → Assets → Beneficiaries → Connected jurisdictions and their rules

That map, combined with qualified professional advice in each relevant jurisdiction, is the foundation of a cross-border trust structure that functions as intended rather than producing compliance surprises years after establishment.

If you are an international investor, a family with cross-border trust arrangements, a trustee dealing with multi-jurisdictional beneficiaries, or an overseas adviser seeking Bahamian legal counsel for a client with a Bahamian trust, contact the ParrisWhittaker team to discuss the Bahamian legal dimensions of your structure.

Frequently Asked Questions

What is tax residency?

Tax residency generally refers to the jurisdiction that considers an individual or entity resident for its domestic tax purposes, based on that jurisdiction’s specific rules. The test varies substantially between countries and may depend on factors including physical presence, permanent home, family connections, economic ties, and domicile. There is no single universal definition.

Is trust residency the same as tax residency?

No. Trust residency and personal tax residency are legally distinct concepts. Personal tax residency applies to an individual and is determined by the rules of the relevant jurisdiction applied to that individual’s personal circumstances. Trust residency depends on which legal or reporting framework is being applied and what factors that framework considers, which may include the location of the trustee, the place of administration, or specific statutory definitions.

Is a trust automatically resident in The Bahamas if Bahamian law governs it?

Not necessarily. Governing law and residence are different concepts. Under the June 2024 updated Bahamas CRS guidance, a trust classified as a financial institution with a trustee residing in The Bahamas will be considered reportable in The Bahamas under the CRS framework. But that definition applies specifically to the CRS reporting context and does not determine residence for every legal, tax, or reporting purpose.

Does establishing a Bahamian trust make me tax resident in The Bahamas?

No. An individual’s personal tax residency is determined by the rules of the relevant jurisdiction applied to their personal circumstances. Creating a trust, appointing a Bahamian trustee, and choosing Bahamian governing law are none of them determinative of personal tax residency.

Can a trust have beneficiaries who are tax resident in different countries?

Yes. Beneficiaries may be resident anywhere. Each beneficiary’s domestic tax jurisdiction may apply different rules to distributions they receive from a foreign trust, and those rules may produce substantially different tax and reporting outcomes for different beneficiaries receiving the same distribution.

What happens if a trust beneficiary moves to another country?

Relocation changes the beneficiary’s domestic tax and reporting position. Their new jurisdiction may classify the trust differently from the previous jurisdiction, may impose new reporting obligations, and may tax distributions differently. Relocation is a significant review trigger, and obtaining advice before the move occurs is generally more effective than addressing the consequences after it has taken place.

Does changing trustees change trust residency?

Potentially, depending on the applicable residence rules and which framework is being considered. Under the Bahamas CRS guidance, trustee residence is a relevant factor in determining whether a trust is reportable in The Bahamas. A change in trustee jurisdiction may affect that analysis. The consequences depend on the specific framework and must be verified with qualified advisers.

Does a Bahamian trust have CRS or FATCA reporting obligations?

Potentially, depending on how the trust is classified and who its connected persons are. A trust classified as a financial institution has reporting obligations under both frameworks. A trust classified as a passive non-financial entity may cause its controlling persons to be reportable at the level of the financial institution holding its accounts. The trustee is responsible for the trust’s compliance with applicable CRS reporting obligations in The Bahamas.

Is trust residency the same as the trust’s governing law?

No. The governing law determines which jurisdiction’s legal rules govern the trust’s interpretation, administration, and the rights of its parties. Trust residency for tax and reporting purposes is determined by separate frameworks applying different criteria.

Should a trust be reviewed before the settlor or a beneficiary relocates?

Yes. From a legal and compliance planning perspective, obtaining qualified advice before relocation allows the consequences to be identified and, where possible, addressed in advance. Advice obtained after a move has occurred may be working against a fait accompli.